PURPOSE: To improve storage stability, dryness and rust prevention by dispersing a carboxylated alkyd resin (derivative) and a rust preventive pigment in water.

CONSTITUTION: Condensation is carried out using 100 pts.wt. (herein-after abbreviated to pts.) mixture comprising 25-60 pts. fatty acid and/or oil (e.g. tung oil), 25-60 pts. epoxy resin, 0-15 pts. 1-18C monobasic acid (e.g. benzoic acid), 0-30 pts. polyol (e.g. polyethylene glycol) with a number-average molecular weight of 400-20,000, and 0-20 pts. polybasic acid (anhydride) (e.g. phthalic acid) to obtain 50-90 pts. (based on solid matter) epoxy ester resin. In the presence of this resin, 50-10 pts. unsaturated α,β-ethylenic monomer (e.g. styrene) is polymerized as required to obtain a carboxylated alkyd resin (A) comprising a (vinyl- modified) epoxy resin and having an acid value of the solid compenent in the resin of 20-50. 100 pts. component A is kneaded with 0.5-10 pts. rust preventive pigment (B), and the hydrophilic groups of the component A are neutralized with an amine. The resultant mixture is dispersed in water while stirring.